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Sharesies vs. Hatch: Which Investment Platform is Right for You

Introduction

Investing in the stock market has become more accessible than ever, thanks to the proliferation of online investment platforms. Two popular options in New Zealand are Sharesies and Hatch. These platforms offer different features and cater to various investment preferences, making it essential to understand the differences between them to determine which one is the right fit for your financial goals. In this article, we’ll compare Sharesies and Hatch, exploring their key features and what sets them apart.

Sharesies: Making Investing More Accessible

Sharesies, launched in 2017, has rapidly gained popularity in New Zealand for its user-friendly interface and mission to democratize investing. The platform allows users to buy and sell fractional shares, making it ideal for those who want to start investing with a limited budget. Here are some key features of Sharesies:

  • Affordability: One of Sharesies’ standout features is its ability to buy fractional shares, meaning you can invest in high-priced stocks without needing to purchase a full share. This opens up investment opportunities for individuals with modest budgets.
  • Diverse Investment Options: Sharesies offers a wide range of investment options, including New Zealand and international shares, exchange-traded funds (ETFs), managed funds, and more. This diversity allows you to build a well-rounded portfolio to meet your investment objectives.
  • User-Friendly Interface: The platform is designed with the user in mind, making it straightforward for beginners to start investing. It provides educational resources and tools to help users understand the world of investing.
  • Transparency: Sharesies is transparent about its fees, making it easy for investors to understand the costs involved in their investments. The platform charges an annual subscription fee, which can be advantageous for active investors with a larger portfolio.
  • Community and Social Element: Sharesies fosters a sense of community through its forums and discussion boards, where users can engage with other investors, share their insights, and learn from one another.
  •  Join Sharesies here

Hatch: Access to International Markets

Hatch, on the other hand, is designed to provide New Zealanders with access to international investment opportunities. It offers a gateway to the US and Australian stock markets, allowing users to invest in companies listed on these exchanges. Here are some key features of Hatch:

  • Access to International Markets: Hatch enables New Zealand investors to purchase shares in companies listed on the US and Australian stock exchanges, such as Apple, Amazon, and Tesla. This access to global markets provides diversification opportunities beyond the local market.
  • Direct Ownership of Shares: Hatch allows users to directly own shares in the companies they invest in. This means you have more control over your investments and can receive dividends if the company pays them.
  • Wide Range of Investments: In addition to individual stocks, Hatch offers access to ETFs and index funds, providing a broad range of investment options to suit various strategies and risk appetites.
  • No Subscription Fee: Unlike Sharesies, Hatch does not charge an annual subscription fee. Instead, it operates on a transaction-based fee structure, where you pay a fee when you buy or sell shares.
  • Educational Resources: Hatch offers educational resources and insights to help users make informed investment decisions, particularly in the context of international markets.
  • https://app.hatchinvest.nz/share/rtb24muk

Which One Should You Choose?

The choice between Sharesies and Hatch ultimately depends on your investment goals, preferences, and level of experience. Here are some considerations to help you decide:

Choose Sharesies If:

  • You are a beginner investor or have limited funds to start with.
  • You prefer to invest in New Zealand shares and ETFs.
  • You appreciate a user-friendly platform and a sense of community among fellow investors.
  • You want transparency in fees and are comfortable with the annual subscription model.

Choose Hatch If:

  • You want to access international markets and invest in US and Australian stocks.
  • You have a specific interest in owning shares in individual international companies.
  • You are comfortable with a transaction-based fee structure and don’t want to pay an annual subscription fee.
  • You are looking for diversified investment opportunities beyond New Zealand.

Conclusion

Sharesies and Hatch offer unique investment opportunities, catering to different preferences and financial goals. Sharesies is well-suited for those looking to invest in New Zealand and start with a limited budget, while Hatch provides access to global markets and individual international stocks. Carefully assess your investment objectives, risk tolerance, and budget to determine which platform aligns with your needs. Both platforms have their strengths, and the choice between them should be based on what suits your individual circumstances and investment strategy.

Disclaimer: I may receive a small commission if you sign up with Sharesies or Hatch.

www.robertastewart.com

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Budgets for personal finance

Establishing a budget is an excellent way of tracking your spending and  you do not need to be struggling with money matters in order to benefit from using a budget. 

Budgets can expose some cold hard home truths

Doing a budget can be the simple solution to rectifying a challenging financial situation but few people do a budget because it exposes spending habits which they prefer to keep hidden. Many people do not want to change their habits despite it costing them an arm and a leg.

There are two parts to a budget.

Your income and your spending.

Your income can be wages from a job, profit from a business, or  income from investments.

Your spending covers everything which is costing you money. 

In short if it makes you money it is income and if it costs you money it is spending.

If you can do some simple maths you will soon discover whether you are left with a surplus or a deficit.

If you have a surplus and you are in debt, use the money to pay off your debt.

If you do not have any debts you can use some or all of your surplus for one or more of your goals; this could be saving for a holiday, saving for a house deposit, saving for a car, or investing it in the share market.

There are so many places to invest your money these days that if you did your homework you will find an appropriate investment for your circumstances.

If you have a deficit you need to take some kind of action rather than try and bury your head in the sand because if you do nothing your financial situation will worsen.

There are two things you can do to balance the books;

1 Reduce spending

2 Increase your income

I don’t know how financially literate you are but if you do not understand financial jargon then I advise you to see a financial advisor to discuss your situation. The public library will have information on where to find a budget advisor.

At the Library will will also find good books on how to manage your finances and increase your wealth.

A budget advisor is unable to help you unless you are completely honest about where your money is going. 

It is up to you to make the decision on which sacrifices you are prepared to make. No one else can make that decision for you.

Your spending can be placed in two categories, your needs and your wants. You may be able to reduce some of the money you spend on your needs but it is the money you spend on your wants which you may find easier to eliminate. 

Being able to afford whatever it is you need can be as simple as re prioritizing your spending. It is a matter of transferring your spending from one item to another.

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Share Tumble Scenario

INTRODUCTION

The share market has enjoyed a great run since the Global Financial Crisis. Will it continue or will a major fall in the markets put an end to it all? No one knows therefore, it is important to set proper financial goals and use strategies to factor in scenarios which may or may not occur.

What to do if the share market crashes

The 1987 share market crash known as “Black Monday” wiped out fortunes as many investors lost their life savings. Those of a generation who were around back then will be well aware of what can happen when you place all your eggs in one basket as many investors did. I mean there were stories of investors borrowing money to purchase shares using the value of their shares as collateral. When the markets went down, the value of their shares were a fraction of the money owed on the borrowed money.

The 1987 crash was the worst crash since the 1929 Wall Street crash. There were almost 60 years between 1929 and 1987 so investors need to reassure themselves that another crash may not fall within their lifetime.

So what should investors do when the markets are falling?

Here are my 5 tips:

1 KEEP CALM

Do not fret, markets go up and down like a roller coaster. Treat the markets as a long term investment. If you are young then you have time on your side. There is time for you to recover from financial setbacks. Even if you are say 50 you still have another 15 or so years before you reach the age of retirement so you do not really need to be too conservative, however, someone who cannot stomach the thought of rapidly falling markets would disagree. It all depends on your temperament. 

A financial adviser is likely to steer you to more conservative investments if you are approaching what is termed “The retirement age.” 

2 STICK TO YOUR FINANCIAL PLAN

It is important to stick with your original plan despite all of the negativity in the newspapers which will no doubt arise after a crash. When planning your financial strategy your plan needs to factor in the possibility of a share market tumble. Shares can take investors on a roller coaster ride which reward persistence.

3 DON’T TRY TO TIME THE MARKET

It is time, not timing, which rewards share market investors. Few investors have the knowledge to predict the movement of a share price and those who do and take advantage of it are breaking the law because it is known as insider trading. Investors should do their homework first and trust their own judgment when deciding on which shares to buy. 

4 KEEP SAVING AND INVESTING

The markets reward consistency. Investing into the markets when there is so much negativity which will follow a crash will pay off. As they say “Fortune favors the brave.” The advantage of investing when there is not much negativity and uncertainty in the markets is that you will be able to snap shares up at bargain prices and as the market recovers, investors will gradually jump on the bandwagon and in doing so will give it a shot in the arm.

5 LISTEN TO THE RIGHT PEOPLE

A share market crash will dominate the news for weeks and all of a sudden there will be financial experts coming out of the woodwork with advice on what you should do with your money. A smart investor will be able to discern between good, bad, or downright stupid advice.

www.robertastewart.com

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The Futility of playing the lottery

The Futility of playing the lottery

INTRODUCTION

Is it possible to use a system to beat the odds and live a life of luxury? The lottery or lotto as it is called in New Zealand first began in 1987 and I have never heard of any lotto winner claiming to have found a system to beat the odds. Most have won using lucky dips or lucky numbers, others have just selected their own numbers. 

The odds of winning the lottery

Lotto is played by millions of people worldwide in the hope of one day becoming lucky but for the vast majority of people that lucky lotto day never arrives. The huge odds against winning lotto ensures that millions contribute to the pool but only a few hit the jackpot.

In New Zealand a lotto player is require to select six drawn numbers out of forty. It is called division one. The odds of any one set of six numbers being the successful six are in in three million+

Power ball is when you have selected division one + the power ball number which is 1-10. The odds of winning power ball are so remote that one is more likely to be struck by lightning. It is not surprising that the power ball often jackpots to huge amounts.

Some mathematicians have described the lottery as a tax on stupidity.

At least 66% of New Zealanders play lotto at least once a year. I do not know how many of them play every single week.

People who would otherwise consider themselves intelligent fall for the enticing advertising in order to participate in a gamble that is unlikely to succeed. Rationality simply goes out of the window.

A song and dance is made about the fact that 20% of all lotto sales is donated to various charities.

What I have to say about that is the lottery sucks out more money from communities than it returns. 

If one was simply donating to charities directly the person making the donation is able to claim 33% back in tax. (New Zealand). The advantage of donating to charity directly is one can choose who to give money to.

Lotto players will completely ignore all of the mathematical statistics with the argument, “You have got to be in to win.”

Problem with that kind of thinking is that few people ever do and often when they do win something, the payoff is usually one of the smaller prizes which is often spent on buying more lottery tickets or quickly frittered away in the blink of an eye.

ANNUAL LOTTERY SPENDING

If a lotto player spends $10 per week on the lottery that equates to $520 per annum. Think of what else that could have been invested in or put to better use.

There are so many share market trading platforms around today that the $10-$20 per week spent on lottery tickets could easily be used to start an investment portfolio.

Do the mathematics; $10 per week equates to $520 per annum. Over a lifetime this all adds up to a fortune.

LOTTERY SYSTEMS

Many people will swear by systems; whatever you are told the statistical odds of any set of six numbers being drawn are the same, however, if you choose numbers or a combination of numbers that are not chosen by other players then you will share the prize pool with fewer players if it is your lucky day. This is the type of strategy used by some system promoters.

Do not be deceived into thinking that any system will increase your chances of winning. This is not true!

As far as finances are concerned, I am saying that the money spent on lottery tickets is better directed at investments where you at least have something to show for it such as your retirement fund. 

It should be kept in mind that the lotto millionaires are created only because millions of lotto players have lost. You don’t have to be one of them!

ABOUT THIS ARTICLE

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Investing Mistakes

This article is of the writer’s experience and opinion. If you require financial advice then see your bank manager or financial advisor.

Learning from past investing mistakes

By Robert A. Stewart

“He who never made a mistake never made anything,” 

But, there is no need to make a mistake if you can help it. How? By learning from other people’s mistakes.

The most tragic thing of all is to not learn from your own mistakes; here are some tragic examples which have left people with badly burned fingers.

In October 1987 the share market crashed big time; there were horrific stories of mum and dad investors losing fortunes. Leading up to the crash investors would borrow money to purchase shares by using the value of their shares as collateral. As the share values increased, they were able to borrow more and more money. One story I was told was of a man who borrowed money using the value of his home as collateral. 

Many companies were basically called paper shufflers; in order words they were not producing anything tangible but trading in shares.

It took several years before the market recovered.

One should never borrow money to purchase shares which is the first basic lesson of investing.

During the Global Financial Crisis several finance companies went belly up in NZ; these included Provincial Finance, Hanover Finance, Dominion Finance, Lombard Finance, and South Canterbury Finance. There were sad stories with one common one being of investors who had their whole life savings invested in the company. The media’s spin on this is to tell the viewer about the investors who lost everything they invested but that is not the case. The truth is investors were drip-fed money from whatever money the receiver’s could recover.

The investors concerned had a lot to say about all of this but one thing that was never mentioned was the fact that they placed all of their financial eggs in one basket. This is a fundamental mistake. In one case, an investor had NZ$400,000 invested in Hanover Finance. One would have thought an investor with commonsense would have spread their money around. 

It does make one wonder whether someone provided this investor with misleading advice. 

The second basic lesson is to not place all of your financial eggs in one basket.

Cryptocurrency such as Bitcoin and the like have been very popular during the last ten years. Stories of great wealth have been floating around from time to time of investors who have invested x number of $ and turned it into a fortune worth x. My view of Crypto Currency is that it should be treated as a bit of a gamble where you only invest discretionary income in. Only money you can afford to lose should be invested in crypto currency.

It should be worth remembering that for every person that made a killing of some kind, whether on the share market, cryptocurrency, or other kind of investment, there will be a lot more people who lost their money. What usually happens is that many of those who made the killing will try to repeat the feat and end up giving back most if not all of their gains.

A company called “Cryptopia” which was basically a blockchain which held funds invested in Bitcoin was hacked into and all those with bitcoin invested with cryptopia lost their money. There were some sad stories of an x amount of $ lost.

The third lesson here is to NEVER invest money in cryptocurrency which you can not afford to lose. In other words, only use your discretionary money for Bitcoin.

It is certainly well worth remembering that if there is a chance of capital gain then there is also a chance of capital loss. That is the nature of investing.

The bottom line is this; “It is up to YOU, the investor to take responsibility for your mistakes.

www.robertastewart.com

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7 Ways that Emotional Spending can ruin your financial plan

7 Ways that Emotional Spending can ruin your financial plan

Written by R. A. Stewart

The best financial plan can be undermined by emotional spending; unless you have the right mindset all of your self discipline and planning can be undone by a moment of madness. 

Here are 7 Emotional Spending Habits can hurt your finances:

  1. Pets

Pets can be very costly and unless you are able to keep your emotions in check they can cost you an arm and a leg. A perfect example of this is when a dog or cat lover will spend a grand or more on a vet bill for their pet moggie when the practical thing to do is to just have the thing put down. Keeping pets can be a drain on one’s finances so it is not surprising that the SPCA are inundated with unwanted pets during the cost of living crisis. The money spent on keeping these pets could have gone toward a rainy day fund which would have enabled the people concerned to weather any financial storm which came along. Personally I think that spending $1,000 on a cat is stupidity.

  1. Expensive Gifts

Buying expensive gifts is another drain on one’s finances. The recipient may appreciate the gift but it is not the same as liking you. What I am saying is that if the only reason why they like you is because you are spending a fortune on them then they like you for the wrong reasons. People who are always buying gifts for others are approval seekers. They seek approval from others and gift giving is their way of achieving this. Giving expensive gifts will drain your finances and is not worth it because it will add up to a fortune in the long run.

  1. Alcohol

Spending too much on alcohol has put paid to many promising careers not to mention being a drain on their finances. Problems with alcohol are usually brought on by emotional needs. Whatever issues you have will be made worse by alcohol therefore it is better to deal with whatever problems you have rather than trying to forget them with alcohol.

  1. Sales (Boxing day, Black Friday, etc.)

You have seen all of the sales advertised on the TV and the internet. Black Friday and Boxing Day sales The sales frenzy on these two days is unreal and it is generated by advertising which appeals to the “Fear of missing out” emotion. 

  1. Lotteries

Gambling is a harmless bit of fun if you are sensible about it but it is when you start placing sizable bets that are affecting your budget that when there is a problem. If that sounds like you then it is time to take stock and find a less expensive hobby.

  1. Cars

Some people are not satisfied with just a vehicle which is adequate for their requirements; they have to go out and spend a lot more on something which is flash in order to impress their peers. Your ego has to be kept in check otherwise it will cost you a fortune over your lifetime. 

  1. Manipulation

Having a strong will and self-discipline will help you become wealthy because there will be people who you have to deal with on a daily basis who have differing views to you as far as finances are concerned. People will try to get you to conform to their values in order to make you just like them. Some will try a tactic known as manipulation by guilt. This is when you are made to feel inadequate or guilty because you won’t do as they say or conform to their value system.

The bottom line is, “They will play on your emotions.”

Don’t try to reason with these people because that type of individual tends to contradict everything you say.

About this article

You may use this article as content for your blog/website or ebook. The article is of the opinion of the writer and may not be applicable to your personal circumstances.

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Setting personal goals

Setting goals does not have to involve money on its own. If you set goals based on money then your life is out of balance. It is important to decide what is important to you and is the vehicle to helping you to achieve those aims. In short, money should not be your number one aim. 

If you accept a job with a higher pay then you had better weigh up everything that the job involves such as the hours of work, the commute to the job, and responsibilities that come with the job and then decide whether it is worth all of the hassle.

It all depends on your personal circumstances and preferences. There is no size that fits everyone when it comes to goal setting. There is no such thing as “should” even though there are people who think others should do this or do that.

Personal goals are something which are personal to you. Here are some examples of personal goals:

Learning to swim

Learning a new language (specify)

Learning to drive

Learning to use the coffee machine

Learning to salsa dance

Reading the Bible from cover to cover

Meeting your favourite sports player

joining a sports club (specify)

The most important factor in determining your personal goals is your passions. The other factor is your talents. These two are often linked. Whatever most interests you is often where your talents lie but that does not mean that you cannot learn anything new. Most skills and talents are transferable. 

We often see international sports people using the skills which enabled them to reach the elite level in their chosen sport to help them succeed in their chosen career after they have retired. Many have prepared themselves for life after sport by studying to gain a degree during their playing days.

It pays to have a number of strings to your bow as a backup. 

You have to specify what your goal is otherwise it just becomes a wish and anyone can make a wish but it is taking action which will turn a dream into reality.

If you went to your travel agent and asked for a plane ticket they are unable to help you unless you were specific and told them your proposed destination.

Examples of vague goals which are non specific are:

To lose weight

To get fit

To be happy

To save money

The problem with vague goals is that there is no way of knowing when you have achieved your goal. Goals need to be specific and timed. A goal of “To deposit at least a grand into my retirement fund by June 30th, 2023 is a specific and timed goal. You have either achieved your goal or not.

A get fit goal may be “To be able to run a 5k fun run by 31 December 2023.” This is another example of a specific goal which has been timed.

Giving your goals a timeline will give you more motivation. Just telling yourself that one day or some day I will do such and such is not a goal; it is a wish and there is a big difference between wishing for something and being serious about achieving it.

Life needs to be in balance and it is important to consider your personal talents and preferences. Many people have achieved extraordinary success in their chosen field and despite not setting out to make money have accumulated a great sum of money doing something they enjoyed. 

The key here is to not make money your number one goal in life but rather discover your calling. No one else can discover that for you so come out of your shell and broaden your horizons. Who knows, you may just discover your life’s calling in doing so.

About the article

You may use this article as content for your website, blog, or ebook. The information may not be applicable to your personal circumstances therefore, discretion is advised.

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Needs Versus Wants

Written by R. A. Stewart

What is the difference between a need and a want?

To explain it in plain language a need is something we need for our day to day living such as food, shelter, clothing, and utilities, while a want is something we desire but can do without. It is all down to prioritising your spending. 

Even a need is something which you have a measure of control over. We all need clothing but you do not have to purchase the most expensive clothes in order to meet this need. Your local charity shop will be able to supply you with appropriate clothing for a few dollars.

The same applies to food; you can meet this need by taking advantage of the specials in the supermarket and by not wasting food.

Money which is able to be saved by making smart purchases can be put to be used elsewhere. “Better in your pocket than someone else,” as the saying goes.

That does not mean you should just fritter away the money on something which you want.

Some people will try to reduce whatever they spend on a need in order to finance a want, none more so when we are talking about their hobbies and the things they are passionate about. Collectables are a prime example.

When you hear about the collections of some people whether that is dolls, beer labels, or whatever, you think that how can one person finance all of that? Some other area of their personal finances must suffer in order to pay for all of it; that may be travel or retirement savings.

We all have a choice of what we spend our money on at the supermarket and spending that money on good wholesome food is a wise investment. Can you spot any foods on this list that you may leave off your shopping list?

The difference between a need and a want can be subjective; for example a person who is addicted to alcohol, cigarettes, and drugs would categorize these items as needs but these are wants to someone who does not have to deal with these issues.

Needs

Housing

Clothing

Food

Water

Medical needs

Wants

Overseas holiday

Hobbies

Gambling

Expensive clothing

It is important to note that needs vary from one person to another and that your budget needs to be tailored to your own personal circumstances and not copied from someone else’s needs.

Before you spend money on expensive needs such as a vehicle, ask yourself, “What is the least expensive option?”

Purchasing a flash car just to impress your peers and to keep up with the Joneses is a mistake and will cost you in the long run. 

A vehicle may be a need if you require it for transport but it becomes a want if you desire the most expensive model. 

There can be consequences to not having your needs filled. It may result in illness and even death if your medical requirements are not met.

It is all a matter of getting your priorities in the right order and that requires wisdom. You do not have to experience something to know that it is bad for you; you just need to open your eyes and see the experiences of others and learn. 

About this article

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Investing for seniors

Investing for seniors

Written by R. A. Stewart

 

Your age is a crucial factor in establishing your savings and investing strategy. Your 20s, 30s, 40s, and 50s are your savings years. It is these years when you build up your assets. 

Your 60s and 70s can be considered your spending years. It is when you tick off items on your bucket list while you are able to.

That does not mean that you do not have to work, a lot of older people are taking this option, not because they cannot make ends meet on their pension, but because they enjoy what they are doing.

In New Zealand, retirees will have access to their kiwisaver account once they reach the age of 65. Money invested in kiwisaver will be in growth, balanced, or conservative funds. Most people during their working life opt for growth or balanced funds.

It is time to decide whether to stay with the status quo or invest in more conservative funds. 

Your age and your health are the two most important factors in deciding which fund to invest your money in. 

Older people do not have time on their side to overcome financial setbacks such share market falls and so forth, therefore if you are 60+ it is a good idea to lean toward more conservative investments but still retain some exposure to risk.

It is worth mentioning at this point that New Zealand financial advisor and writer Frances Cook has a formula for calculating how much exposure you should have based on your age, and it is this…

Subtract your age from 100.

If for example you are aged 60 then only 40% of your portfolio should be invested in the share market.

I do not necessarily agree with this formula and my exposure to the share market is more than her formula suggests I have.

However, that is a personal choice; one that I do not necessarily recommend to you because your circumstances will be different as they are for different people.

If you are connected to the internet and you have a lot of spare cash in your account then I suggest that you place most of your money into an account that is not connected to internet banking. This is to reduce your chances of becoming a victim of internet scammers. 

With internet banking being the norm, this could be difficult in the future though.

In any case I still believe that it will pay to arrange your finances so that if you fall victim to a scammer then not all of your money will be lost. 

Don’t leave all of your money in the one account for goodness sake as some victims of scammers have.

If you are traveling then make sure you don’t have access to your life savings because if you do then so will be a scammer if they manage to get hold of your login details. What I am trying to say is you should leave your entire life savings in an account which you use to do your daily spending. Keep it in a separate account from the account you do your day to day banking. The 

Scammers have all kinds of ways to trick people into handing over their login details.

Anyone can be a victim so don’t be proud by saying “I am not that stupid.”

As you get older you will have to invest more conservatively; that does not necessarily mean transferring from growth to conservative funds but investing some of your current savings into low risk accounts. The deciding factor is your timeline. How soon you need the money and funds which are going to be used within 12 months are best invested conservatively.

 

www.robertastewart.com

 

ABOUT THIS ARTICLE

This article is of the opinion of the writer and may not be applicable to your personal circumstances. Feel free to share this article. You may also use this article for your website/blog or as content for your ebook.

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The Benefits of Saving

The advantages of saving

Written by R. A. Stewart

Having savings will make life easier later on down the road. Just think about these benefits of saving money that people who are shopaholics cannot take advantage of.

  1. You are able to invest the money and grow your wealth. There are ample opportunities to invest your money and make it grow and if you are able to save your money, you can take advantage of these.
  2. When you save up for something instead of using your credit card then you save on interest repayments. People who buy stuff on credit are paying more than if they have paid in cash. During a person’s lifetime, this interest adds up to a fortune.
  3. Having savings behind you gives you more options. If you spend everything you make then when the time comes that you may lose your job, you are inhibited by your lack of resources. People with savings behind them are able to move to another city in order to find work.
  4. When an emergency arises such as dental repairs, car break down, family occasion such as a wedding or funeral, you are in a better position to deal with it if finance is not a problem.

Saving money requires self-discipline and responsibility for your own finances and with a bit of planning and organization you can make life easier for yourself to cope with the financial hits that will occur from time to time.

Having a plan for your money instead of just saving for the sake of it will give you motivation to keep saving. There are several things you could save for; here are some ideas.

* An emergency fund

*To build a share portfolio

*Save for a car

*Save for a wedding

*Save for a house deposit

*Save for an education fund for your kids

*Dentist and medical bills

Money which is used for saving is disposable income; it is money left over after paying your fixed costs. Think about what you spend your money on that is a want rather than a need. That is money which can be saved and used elsewhere. Money which is spent on wants is considered as consumer spending; it is money which is consumed. Disposable income or discretionary spending money as it is also referred to can be used to protect yourself against future financial shocks. It is the responsible thing to do to make choices which benefit you and your family. 

Irresponsible people just fritter away their disposable income without any thought to the future. What you spend your money on will make a difference to future financial outcomes. It all boils down to planning which will in turn help you to make better choices. No one ever reached the retirement age and regretted that they joined a retirement scheme. 

Always strive to save when you are in a position to do so because life does not always follow a straight path; there will be setbacks along the way as those people affected by natural disasters will tell you.

About this article

This article is of the opinion of the writer and may not be applicable to your personal circumstances, therefore discretion is advised. You may use this article as content for your ebook, website, or blog. 

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The savings habit should be developed from a young age.